Term: 36 months
Amortization: Full Term IO
TILC Holdback: $4,210,300
Rate: SOFR + 220
George Smith Partners successfully advised on the placement of an $18,000,000 bridge loan to finance a fee simple retail center in an affluent Northern California suburb. GSP was able to procure a lender in a turbulent market that was willing to provide significant cash out on an excellently located retail property. The 100,000+ SF fitness anchored neighborhood center was 52% occupied at the time of closing and will reach 90% once the fitness tenant opens for business.
Although the property performed well during COVID, GSP had to strategically market the opportunity considering the recent loss of the previous anchor tenant that has been replaced by the fitness tenant. Due to the extremely strong sponsorship, the Sponsor received 100% of the floor funding as cash out (the property was free and clear of debt) with additional TI/LC holdbacks for the fitness tenant. As retail experiences a strong recovery, this execution serves as a prime example for retail investors to enter a shorter-term loan during a rising rate environment and avoid committing to decade-high rates.
April 5, 2023
GSP utilized a quick close bridge fund to provide 3 separate loans:
$7,150,000 Distressed Multifamily Purchase – 80% LTC in Los Angeles
$2,200,000 Mixed-Use, Retail-Residential – 65%LTV in Los Angeles/Venice
$2,580,000 Restaurant/Retail – 65% LTV in Pasadena
George Smith Partners successfully arranged three bridge financings in Southern California. In today’s turbulent market, private quick close options are sometimes necessary. The ability to act quickly often allows our clients to become the chosen Buyer- purchasing these Properties at a large discount or solve a tenant/occupancy issue before a permanent refinance.
GSP worked with a local REIT to develop a program that includes a first and second private mortgage of up to 85% of acquisition price. With the fund and GSP, the loans are underwritten to the future value, to allow the client to implement their strategy. When used for purchasing a property, the loans are designed to provide the same surety of close as an all-cash buyer, with no appraisal needed and the ability to close as fast as 5 business days. The loans are non-recourse and have no prepayment penalty.
These loans are cheaper and easier than equity partners and allow the Sponsor to take advantage of opportunities using less cash.
Blended Rate: 7.9% – 10.5%
Blended Rate – Based on Leverage
Loan to Purchase Price: Up to 85%
Term: 12 Months
September 29, 2021
George Smith Partners secured $4,030,000 of bridge financing for the acquisition of retail shop space in Tempe, AZ. The collateral encompassed approximately 30,000 sf of in-line retail space and an outparcel pad within a larger anchored retail center. At purchase, the collateral was only 44% occupied. The Sponsors believe that a new leasing strategy will be able to drive tenants to the Center. The Property is located on one of the corners of a major intersection that sees over 65,000 cars per day and is less than two miles from Arizona State University, one of the largest universities in the country. The capital provider structured the financing to have a holdback for future property improvements, leasing costs, and interest payments. Priced at 30-Day LIBOR + 7.00%, the non-recourse loan was sized to 68% of total cost and carries a two-year term with extensions. The Lender was also able to include partial releases if only a portion of the collateral is sold.
Rate: L + 7.00% (0.25% LIBOR Floor)
Term: 2 Years with Two 6-Month Extensions
Loan-to-Cost: 68% LTC
Amortization: Interest Only During Initial Term
Guaranty: Non-Recourse with Standard Carveouts
$42,400,000 (80% LTC) Bridge Financing for a 26-Property Portfolio of Walmart Shadow-Anchored Shopping Centers; Located Throughout the Midwest and South
August 25, 2021
George Smith Partners successfully placed $42,400,000 in non-recourse bridge debt financing, which funded 80% of total project costs for the acquisition and value-add business plan of an off-market, 26-property retail portfolio spread across 19 midwestern and southern states. Although financing retail value-add business plans during COVID is challenging, the portfolio is comprised of a diversified rent roll including 20% of gross potential rent derived from investment-grade tenants. Furthermore, each asset within the portfolio is shadow anchored by strong performing corporate owned Walmart grocery shopping centers.
GSP leveraged its lender relationships and capital markets expertise to source a lender who understood the business plan and product type, who was willing to invest the time and effort to underwrite a large retail portfolio spread throughout 19 different states, and in markets with average populations below 30,000; during COVID.
Rate: L + 5.05% (5.10% floor)
Amortization: 24-months I/O, 25-year amortization thereafter
LTV: 76% As-stable loan-to-value
Lender Fee: 1% in / 1% out (waived if CMBS exit through Lender)
Prepayment: 18-months minimum interest with pre-negotiated release provisions for each property and with open prepayment on certain assets identified prior to close
June 23, 2021
George Smith Partners successfully arranged bridge acquisition financing for a 6-unit retail property in Los Angeles, California. The Subject Property took a major hit with rent collections during the Covid-19 pandemic and was operating below market conditions. GSP identified a capital provider who was able to offer an aggressive rate and terms, required no holdbacks of any sort, required no deposits to be held at their branch and provided an open prepayment penalty structure that allowed the Sponsor flexibility once the Subject Property is stabilized and seasoned.
Term: 7 years
Amortization: 25 years
Prepayment Penalty: None
Minimum Interest Payments: None
Guaranty: Full recourse
Banking Relationship/Deposits Required: None
$11,200,000 Non-Recourse, Cash-Out Bridge Refinance for Two-Story Retail in Koreatown; Los Angeles, CA
January 27, 2021
George Smith Partners secured a $11,200,000 non-recourse bridge refinance with cash-out for a two-story retail plaza in the heart of Koreatown in Los Angeles, CA. Located next to a Metro D (Purple) Line subway station along a very busy stretch of Wilshire Boulevard, the Property is anchored by 7-Eleven and Carl’s Jr. and features a fast-casual food hall on the second floor. However, the food hall has been closed due to COVID.
The Sponsor, a prolific developer and property owner, recently announced plans to replace the plaza with a 17-story, mixed-use apartment tower that includes affordable units and some commercial space. GSP was engaged to source a bridge solution to pay off the existing maturing loan and provide prepayment flexibility once the Project’s entitlements and permits are secured.
GSP focused on the strength of the Sponsor, the bustling and densely populated Koreatown market, home to several large and small-scale projects currently planned or under construction and the Purple Line Extension project which will provide a dependable, high-speed alternative for travel between downtown Los Angeles, Miracle Mile, Beverly Hills and Westwood. The financing closed within 11 days of the term sheet being signed.
All Terms Confidential
June 17, 2020
George Smith Partners arranged $13,500,000 in quick-close, cash out, bridge-to-bridge financing for a multi-tenant retail center in Echo Park, California. The Sponsor approached GSP with intentions of taking out their existing lender due to an issue with lease approval for a cannabis tenant. In order to purchase an out-parcel on the Property, the cannabis user needed a lease in place so it could obtain a license from the local jurisdiction. If approvals were not granted, the Sponsor would have the ability to break the lease. GSP identified a non-bank lender who was comfortable approving a lease on a space which may never be occupied. The Lender’s flexible prepayment structure allowed the Sponsor to execute their business plan as the cannabis tenant planned to acquire an out-parcel on the Property after receiving approvals from the City. The first trust deed was sized to 60% of value with no hold back requirement for interest reserve or capital expenditures. The non-recourse, interest only loan does not carry any prepayment penalties. The Sponsor plans to take out the loan within 12 months with long-term fixed rate debt.
Term: 12-month term with one 12-month extension option